Vaxjo, Sweden, 03 February 2011 -- Södra has decided to shut down most of its operations at its Södra Timber Åtvidaberg sawmill. Some 39 employees will be affected by the change, and negotiations under the provisions of the Codetermination in Industry Act will commence immediately.

"The sawmill has developed well, but times are changing. The market for sawn timber products is tough, and competition for raw materials has increased," said Peter Nilsson, CEO of Södra Timber.

"Södra has to have first-class facilities in the face of competition in order to safeguard its ability to pay for timber, and the sawmill in Åtvidaberg requires significant investment at present. We do not think it is possible to continue investing in all ten of our sawmills, and this change will result in a more appropriate structure," Nilsson said.

"Overall, we are seeing a good balance in our timber business in eastern areas thanks to our operations in Kinda and the development we are seeing in Mönsterås. We will also be increasing our sawmill production and will need more raw material at Södra Timber Värö over the year, where we are currently building a sawmill with an annual capacity of 750,000 cubic metres," added Nilsson.

However, the pressure impregnation facility in Åtvidaberg will remain in place. Södra Skog's office in Åtvidaberg will not be affected by the changeover. Södra will still need a certain level of timber on site for seasonal storage.

At the same time, the Traryd sawmill will be transferred from Södra Timber to Södra Interiör, and converted from pine production to 100% hardwood. This move is due to the fact that Södra Interiör is increasing its sales of interior products made from all the hardwood varieties growing in southern Sweden.

"Handing over the sawmill in Traryd to Södra Interiör is a positive step. We have found a really excellent solution for the sawmill and the staff who work there," Nilsson concluded.

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